Spring Statement: OBR revises up GDP; Inflation to fall to 2%

Britain's sluggish economy looks set for more weak growth stretching out over the next five years, according to official forecasts announced by finance minister Philip Hammond on Tuesday as the country heads for Brexit.

Growth forecasts in 2019 and 2020 were 1.3 percent for both years, unchanged from the November forecast.

In his first spring statement to the House of Commons, the Chancellor revealed that the Office for Budget Responsibility now expects GDP growth in 2018 to be 1.5%, rising from the estimate of 1.4% at November's budget.

Those forecasts, based on the assumption that Britain would stay in the European Union, saw growth of above 2 percent for each year between 2018 and 2021.

Looking at employment, Hammond said he expected to see 500,000 more people in work by 2022. The move was initially announced in last autumn's Budget.

The figure is now thought likely to come in around £43 billion, rather than the £49.9 billion forecast in November, delivering a knock-on boost to subsequent years.

Mr Marshall said that a "far stronger push" is still needed to "fund and fix the fundamentals here in the United Kingdom over the coming months".

The OBR has already upgraded its fiscal forecasts twice over the previous year, in March 2017 and November, as tax receipts have come in stronger than previously expected.

As a result, private debt now amounts to 170% of GDP, providing a far bigger drag on the economy than the much anxious about public debt, which stands at 85%."Despite Philip Hammond's cheerier outlook, there is no "light at the end of the tunnel" for families across the country".

Mr Hammond criticised Mr McDonnell for his "bully boys" remark and later said of Labour's economic approach: "Every now and again the mask slips and we get a glimpse of the sinister ideology that lies beneath, an ideology that would wreck our economy if he ever gets anywhere near the controls".

Mr Hammond said he was inviting cities across England to bid for a share of £840 million to deliver on "local transport priorities".

Mr Hammond said his deputy Elizabeth Truss would publish the departmental allocation of more than £1.5 billion of Brexit preparation funding for 2018-19.

The Chancellor also informed MPs that around 60,000 first time buyers have benefited from the stamp duty relief he announced in the Autumn Budget.

Chancellor Philip Hammond set out his vision of an "outward-looking, free-trading nation, one that is confident that our best days lie ahead of us".